The world’s biggest AI chipmaker has officially overtaken tech giant Apple as the second most valuable company across the globe.
Nvidia Skyrockets
Everyone’s favorite artificial intelligence chipmaker has exceeded expectations, soaring following its result release to become the second most valuable company globally, just behind Microsoft.
$3 Trillion Market Cap
The company saw its market capitalization rise to a staggering $3 trillion, ending at $3.019 trillion at market close, compared to Apple’s $2.99 trillion market cap.
The Big Three
So far, Nvidia, Microsoft, and Apple are the only companies in history to cross the $3 trillion market cap threshold.
A 5% Raise
It also saw its shares rise by 5% to approximately $1,224.4 per share, compared to Apple’s 0.8% rise in the same session.
Crazy for AI
The multinational chip manufacturer can thank the growing technological and cultural frenzy over AI for its enormous success, as many of the biggest AI companies use Nvidia chips to power their large language models (LLM).
Exponential Increase in Stock Value
Over the last two years, the Santa-Clara-based company has seen its stock soar exponentially, jumping by 239% in 2023 and 147% since the beginning of this year.
Not Likely to Slow Down
Its popularity, share value, and market dominance may not slow, as the company looks to split its stock ten-for-one to further appeal to investors.
“A Tremendous Run”
“It certainly has been quite a tremendous run for the AI darling for the past couple of years,” said Commsec Market Analyst Laura Besarati, who also called it a “great time” to purchase shares in the company.
New King of Silicon Valley?
While Apple has dominated Silicon Valley since the introduction of the iPhone in 2007, Nvidia has slowly taken over as the foremost company in the industry.
New Chip Rollout
Now, Nvidia is already looking to expand its offerings to continue riding the tide of the AI boom. CEO Jensen Huang recently announced the rollout of Rubin, the company’s next and most advanced AI chip, coming in 2026.
Potential to Overtake Microsoft
Some industry experts have even predicted that Nvidia could overtake Microsoft too, as major players like Microsoft, Apple, and Meta now partially rely on Nvidia’s flagship H100s to power their AI applications.
70% of All AI Semiconductors
The company currently makes up 70% of all AI semiconductor sales, and some analysts believe that percentage will rise along with the company’s share value.
Big Spending on AI
“Nvidia is making money on AI right now, and companies like Apple and Meta are spending on AI,” said Jake Dollarhide, CEO of investment advisory firm Longbow Asset Management, following the news of Nvidia’s market cap success.
A Foregone Conclusion?
“It may be a foregone conclusion that Nvidia will overtake Microsoft as well,” he added. “There’s a lot of retail money that’s piling in on what they see as a straight shot up.”
Note on Nvidia
Angelo Zino, a senior equity analyst at independent investment research provider CFRA Research, issued a note on the likely continuation of Nvidia’s success following the market cap announcement.
Potential to be the “Most” Valuable Company
“As we look ahead, we think NVDA is on pace to become the most valuable company, given the plethora of ways it can monetize AI and our belief that it has the largest addressable market expansion opportunity across the Tech sector,” he wrote.
A Tech Superstar
Nvidia’s popularity has made it a superstar in the tech industry. CEO Huang, who was originally born in Taiwan before moving to the US, was swamped by the media and attendees at the Computex tech trade fair in Taipei this week.
Musk Seeks More
Major tech companies have been clamoring to obtain as many Nvidia chips as they can afford, with Elon Musk announcing his intention to increase Tesla’s number of active H100s from 35,000 to 85,000 at the company earnings call for the last quarter.
Diverted to X
However, Nvidia officials and spokespeople later confirmed that the last shipment of thousands of chips ordered for Tesla was diverted to Musk’s social media platform X.
Fierce Competition for Apple
Apple, on the other hand, has seen the demand for the iPhone weaken in the last quarter, with fierce competition rising in China as domestic brands gain popularity in the world’s largest market for smartphones.
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
